Windows 7 introduces XP Mode basically a Virtual PC lite and a bit of a copy of Parallels for the Mac.
Virtual XP Mode is a real problematic product. I would use any VM except it.
I found this out the hard way when one of my most important client became dependent on it.
I would not recommend it. It was orphaned by Microsoft as well. The bottom line is these other VMs: Virtual PC, Vbox and Vmware are supported,have tools and have a future and present that is much better than the very proprietary nature of XP Mode. When problems occur in XP Mode you are dealing with a barely supported product and not many support resources.